The construction industry is characterized by complex projects and long-term engagements. In these projects, contracts play a vital role in defining the rights and obligations of the parties involved. This article will discuss the types of contracts used in the construction sector and the legal issues they may encounter.
The main types of contracts commonly used in the construction sector include:
- Turnkey Contracts: These contracts encompass all phases of construction projects. The contractor commits to completing the project from start to finish and delivering it by the agreed date.
- Unit Price Contracts: Contracts where each component of the work is priced separately. This type of contract offers flexibility in determining costs.
- Lump Sum Contracts: Contracts where the total project cost is determined upfront. In this case, the contractor is not affected by cost increases during the contract period.
Construction contracts can lead to various legal issues:- Breach of Contract: When parties fail to adhere to the contract terms, a breach occurs. In this case, the injured party may seek compensation for damages.
- Delay in Completion: Failure to complete projects on time can result in financial losses. Delivery dates specified in contracts are crucial to prevent such issues.
- Quality of Materials: The quality of materials used is critical for the safety of projects. Use of substandard materials can impose legal liability on contractors.
- Disputes and Resolution Methods: Disputes arising between parties can be resolved through court or arbitration. Contracts should specify how disputes will be handled.
Turkish Civil Law and the Turkish Code of Obligations establish the legal framework for construction contracts. The provisions found in the Turkish Code of Obligations (Law No. 6098) play a significant role in the application of construction contracts.
Contracts in the construction sector are crucial for the success of projects. Clearly defining the rights and obligations of the parties helps prevent legal issues. Therefore, careful attention must be given when drafting construction contracts, and necessary legal support should be sought.
